Transcripts For BLOOMBERG Bloomberg Markets Asia 20240713

The hang seng at the moment. The two thirds of 1 . Lets look at what is going on with the nikkei. Market, we are seeing a move to the upside. A case of bad news and good news. Indicating they could institute Interest Rate cuts. Lets get to the other asset classes. This is where we find ourselves at the moment. It must have been quite a meeting between the fed chair powell and his boss, the president. It must have been. A yield to that has barely been budged in. We have been seeing them lurch higher. More uncertainty in the haven buying. Pence against the euro. That is sterling moving to six month highs against its european counterpart as the threat of a hard brexit recedes. Aussie dollar moving to the downside. Just under . 68 u. S. Where it istuation to the downside potentially. Theyof many are saying would not be surprised to see a 66 handle in the nottoodistant future. Then we have the Violence Center stage in hong kong. It is continuing. That continues to be our top story right now. Developing where we are right across the harbor. The university siege raising fears of a bloody crackdown on hundreds of protesters, a lot of them students who remain. Lamchief executive carrie called on these protesters to heed the requests of the police or the orders of the police force with the u. S. Saying it is her responsibility to restore calm. The United States is gravely concerned by the deepening unrest in hong kong including the standoff between protests at hong kong politic and other campuses. We have repeatedly called for restraint from all parties in hong kong. Violence of any size by any side is unacceptable. The Hong Kong Government bears primary responsibility for bringing calm. Violence cannot be resolved by Law Enforcement efforts alone. David our guest is here with us in the studio. What is the latest . How many remain inside the school . We think there are several hundred protesters on the grounds of poly u, as we are calling it. They had very violent clashes, as you noted yesterday, with police. There were raging fires, cars set on fire. A lot of teargas. Some medical professionals were allowed onto the campus to escort off some wounded protesters, but we believe there still are several hundred that may be there. That is the big topic in hong kong today. How are they going to get them out. What are the police going to do . What is the action going to be . Carrie lam is speaking in her regular weekly press briefing. She said that she wants this to end without violence, she wants the protesters to leave voluntarily. That does not look likely to happen given that they have been there for days. Rishaad lots of other signs of disarray. Coming todayssive from the state news agency, coming from those on top, saying that the Hong Kong Court ruling about the city mask ban, which ,hey said was unconstitutional saying that it stands against the National Peoples congress. A lot of moving parts. That is a very Interesting Development because yesterday, the high court of hong kong came out very clearly and said this was unconstitutional, that it was not needed to help the police, and was very clear about saying it was unconstitutional. Now, we have part of the state owned media saying, we will see. Who knows where that goes . It is clearly one fewer tool in the arsenal of the police to try to keep calm here. On are wethings going still have schools being closed and we have transportation disrupted. Rishaad she is speaking english at the moment, talking about 600 protesters left at poly u. Lets have a listen. Polytechnic University Campus has been seized for quite some time already. We are extremely worried about a dangerous situation in the campus. So, the principles i have laid out for the police operation, the first is to have a peaceful resolution as far as possible. This can only be achieved with the full cooperation of the protesters, including the rioters, that they have to stop ,iolence, give up their weapons and come out peacefully and take the instructions from the police. The second principle is a very exceptional one. Although the police have said , thatfter the warning anyone leaving the campus would have to be arrested. In light of those special circumstances, the age that is under 18 of a certain number of participants within the campus and in order to achieve the objective of both a peaceful and resolution, ive asked for the treatment of these miners to be in a humanitarian ay minors to be in humanitarian way. We have arranged for groups and religious groups to encourage and persuade these minors to come out peacefully. If they come out peacefully, we will just put down the data, we will make a record of their personal data and they may then leave the campus and return to home. We have not done any immediate arrest of these underaged protesters or other participants within the campus. Of course, we will have to reserve the right to undertake further investigations in the future. At the moment, as far as i could gather, there were about 600 people within the polytechnic campus who have come out. Andt 200 of them are minors they have been subject to the special arrangements that i have just referred to. 400, over 18, they have been immediately arrested, whether they came out peacefully in their own, surrendered themselves to the police, or they came out using various methods and were caught by the police during this operation. The latest assessment given to me that there would be perhaps about 100 or so people still on campus, so i made a very strong plea for everyone of us who are concerned about the situation, we will use whatever means to persuade and arrange for these remaining protesters to leave the campus as soon as possible, so that this whole operation could be able to end in a peaceful manner and lay the basis for the subsequent work by in police to stop violence hong kong. Thank you very much. Just to recap everything that you may have missed from the chief executive, just doing the basic math, before well, going into this morning, we assumed 700 protesters were at the campus. 600 which have left the campus. 200 of the 600 that left were under the age of 18. You do the math, about 100 protesters who remain. As you can see, equity markets are continuing to climb by 100 or so points. Down 7 yesterday. Down 4. 5 right now. Lets bring in john woods from credit suisse. Level, thereitical is a huge amount of caution. We see some escalation among a potentially dwindling number of hardcore protesters. Im not convinced yet that the dispute is in any way resolved. But these events whacks and wayne and it is possible that the market is responding. I think more broadly, the market is focused on the wider uplifting asian equities. I note that the hang seng is up 3 year to date and the Major Chinese indices are up 30 . There is a marked degree of underperformance in hong kong, the although interestingly some gains. Rishaad is this the end game . I dont think it is the end game. Rishaad im not saying what you are feeling, im saying what other people are feeling out there. That is a really hard question. What do you think is spurring this rally . Look, i think it is probably more bargainhunting. Probably there is probably in mindset of recovery values in hong kong which would rally strongly in the event this dispute does eventually resolve. You know, some of the major counters that have been hit by this are down by 30 , 40 . I think there is a case to be made for bargainhunting and bottom valuations. As far as the immediate resolution, no one anticipates that. But the markets are strong regionally and globally. I dont think we can walk away from that type of positive sentiment. Rishaad where do we go from here . That is the thing. That is what your job is. My job absolutely. Im focused more on china than hong kong to be completely frank. I think the phase one deal is likely to be signed by the end of this month. Once that happens, we are able to refocus on chinas reese table in fundamentals restabling in fundamentals. We have gone overweight on that basis and anticipate positive expected returns in the months and quarters ahead. Were you surprised by that a yesterdayrday omo by five basis points . It is a reality that china faces internal and external headwinds. There is uncertainty over the mediumterm future of the trade discussions between the two. At the same time, china faces some deceleration in internal domestic demand. Any type of monetary easing makes a lot of sense. Furthermore, we are going to see structuredes in spending particularly targeted at the property sector to promote further growth. David the play so far this year in china, since you guys are overweight, was really into consumer staples, almost as a defensive. If risk does come back completely into this market, do we get a rotation out of this index . Absolutely i think you would see a swing back in favor of the cyclicals. Mainly as a valuation driven rotation. There has been a flight to quality in a sector basis and i think that would rotate. It is important to point out that we are not seeing a meaningful bouncing growth in china. It is more a moderation in the deceleration we have seen. You can look and point to the which areof the pmis at five or six year highs right now. I think that sends a positive signal, particularly for the sme manufacturing sector. On that basis, you would start to see some rotation. Declinedcarrie lam has to comment on the court ruling on the mask ban. We will have more on that and more from john woods. Still ahead, as the hong kong protests rage john, businesses have been dragged into the fray. We will hear from one snack chain coming under attack. David jay powell meets donald trump in a rare sit down. Details and the reaction from john woods as he joins us in a couple of moments. This is bloomberg. David ok, President Trump met with fed chair jay powell on monday to discuss the economy, marking the second facetoface it down. Coming outcriticism of the white house on the central bank. President trump said they talked about a wide range of issues including negative Interest Rates. Rishaad powell signaling easing. Eric rosengren expressed concerns about the recent cuts. Im not so sure we needed quite so much accommodation, so im a little bit worried that we have less room than we otherwise would have were we to have a big negative shock. I would say it is probably not just the short end of the markets. Even quantitative easing will have some limited effect given that that could get quite down to zero more quickly than we were expecting. Rishaad lets get it back to john woods. A frosty meeting, one would imagine. John we have long felt that this last cut was the last in the current cycle. We dont think there will be anymore. The typhoon in japan, the vat hike, the gm strike, these are now easing. We anticipate the Global Industrial production will trump this court are picking up next quarter. Signalnds a positive about the Global Economy and the u. S. Economy with the trade talks also approaching some sort of resolution, i think the markets now once again focusing on the reduced, substantially reduced wrist of succession. Needt think there is any now for interest cuts in the u. S. Economy. Yvonne do you think there is a risk on positioning that it is one run ahead of all the fundamentals . Some would argue that fundamentals have not changed that much. John absolutely. I think the bond market got well out of whack with underlying fundamentals. If you look at the number of Interest Rates priced into the market, one point, it was also five. Now we are only back to one. The market has got extremely bearish and revised its view quite dramatically. Even in the last six weeks. I think that is because these discrete oneoff factors are diminishing. The market is now looking at the Underlying Health of the labor market in the United States and essentially coming around to the view that bonds were overbought. Yields fell too low to quickly and now we are seeing this recovery. David anything you would be avoiding into the yearend . John we focus in terms of sectors in tech to financials. On that basis, i think some of the more expensive sectors or something that we are not particularly focused on. Yvonne we want to bring the live pictures back with the chief executive of Hong Kong Carrie lam speaking. Lets take a listen. Some of the cleanup efforts across the city. Lets take a listen. Including the ongoing standoff it Hong Kong Polytechnic University which has turned into a war zone. , as you havell referred to in response to about the voluntary participation in clearing the roadblocks and the debris on the streets, we have made it very that it is to perform defense function. But it is not uncommon from time totime for the garrison undertake some voluntary and charitable activities in hong kong. Ande are very clear rules circumstances governing those situations. I can give you a list of examples in the garrisons participation in charitable activities, like when we had the supertype last year. They came out to clear the collapsed trees, which of course was much welcomed by the people of hong kong. From time to time, they also visited some elderly homes and arranged training activities for some of our youngsters and so on. I would suggest we do not over interpret this particular act of voluntary involvement, particularly if you look at the actual circumstances. ,he ordinary hong kong citizens they were taking part in ofaring roads right in front one of the military facilities of the garrison. People, ifinary people are helping to clear the road in front of your building, then you feel more obliged to give a helping hand. That is the situation. Clarified, this voluntary act of the garrison did not come under any provisions in the basic law. It is not in response to my request. That is the second point. You asked about when we would be thought to formally invite the garrison to help. I would assure you that we remain very confident that we are able to cope with the situation. That is why operations like that happening in the polytechnic university, it is a very important one. I for one anticipate it is a very difficult one, it is a very complicated operation. But if we were not able to undertake any operations to arrest to these rioters who are resorting to escalating violence and who are damaging hong kong from one place to another, from one campus to another, and manufacturing more and more lifethreatening weapons and petrol bombs and so on, we will not be able to demonstrate and to display that competence in dealing with the situation. Right now, we are still sort of displaying and demonstrating that competence to handle the situation ourselves. One last english question. David ok, in case you missed it, that was the hong kong chief executive recapping the last couple of minutes, basically emphasizing not to overread the voluntary act of the Peoples Liberation Army Garrison coming out to clear the roads. They did so in their own choice, it was not the Hong Kong Governments request to do so. Issue is side of that that do they then have their own unilateral leeway into deciding other things . Rishaad she is talking about the commissioner of the police at the moment and the actions being taken, a question about how people are being dealt with and arrested. We can just get her take on that. There we go. Protesters are coming out in a peaceful manner, they stop violence, they give up their weapons, they take the advice of the police, then there is no situation that that sort of violence will happen. And the police will of course render fair treatment to everybody, both arrested and those allowed to go home without being arrested. By those i mean those under the age of 18 and we have about 200 of these under 18 who have come out of the campus and have been dealt with in a humanitarian manner. That is something that we will continue to adopt is a very important guideline. The reason i cannot give you an absolute guarantee is because the situation is changing. If we were suddenly seeing some very major, lifethreatening , then as on the campus i said, the police are on the reactive side, the police have to take the necessary action to prevent any tragedies from happening in hong kong. Was the last english question in the last question we had, as well. That was the News Conference that she does every week. U isjust saying that poly being cleared out right now. Lets get to markets and have a brief look at what is going on. Words of reassurance for investors . These equity markets were in the way up before the press conference started. Speaking, we continued to watch the hang seng. Give or take 4550 points. Lets bring in john woods from credit suisse, asiapacific cio. We arguments sake, because are talking about whether or not it is correct to price in the endgame, assuming the pla does come in, do you think investors will look at that as a good sign , that we are about to see the end of this . John that is a really hard question. If you had asked me that two weeks ago, i would have said it was a profoundly negative outcome. Context ofn the their recent participation, im not so convicted, actually. I think it ultimately depends on a point in time. What i would say is that the has nowty regime completely changed. Rishaad i want to get to that. We have such low volatility. All of this uncertainty, be it what is going on here, brexit, the trade conflict, hungary, south america, the middle east. It has been remarkably low. John you know, you do mention some troubled spots in the world , but actually more broadly, the overarching fears that we had particularly in the Fourth Quarter of last year have pretty much diminished now. I think the market is generally looking at an uptick in global growth, probably in the First Quarter of next year. Those concerns over brexit, over trade disputes, these oneoff factors that were impacting industrial factors. In particular, the Auto Industry in europe, have now diminished. With those risk factors out of the way, volatility has fallen and i guess you could call it fomo, the fear of missing out, particularly for those investors long cash. Yvonne what is your outlook for 2020 . And of the year, all these different types of outlooks are coming out now. Do you think that asia will still outperform the rest of the world and the u. S. . When you take a look at a market like china, historically, they are outperforming. John we dont think there will be a recession in 2020. That is an important distinction to market consensus even three months ago. We are also overweight risk, overweight equities. We believe that that asset class will outperform cash and also outperform bonds. We are recommending to clients based on our outlook that it is the time to start participating and investing in risk assets. I have mentioned that we are overweight china, we are overweight asia highyield, we are recommending Investment Grade for the short duration profile. Away from that, it is a risk story. David always appreciate your insight and your time. Just an update here for your equity markets in hong kong, we are up now 2. 3 over the course of the past two days. It is quite a nice ride so far, monday, tuesday. , thanks to john. Lets get to new york. We have the first word news with the latest in hong kong. All right, we will get right to it. The hong kong chief executive says she wants to peacefully resolve the continued standoff between police and protesters at the polytechnic university. Estimate around hundred protesters are still on the campus and the government is looking for ways to persuade them to leave. She blamed rioters for turning parts of hong kong into war zones and said several University Campuses have become weapon factories. Earlier, as protest clashes continued monday night, secretary of state mike pompeo said the u. S. Was watching the situation closely. The United States is gravely concerned by the deepening political unrest and violence in hong kong. We repeatedly called for restraint from all parties in hong kong. Violence by any side is unacceptable. The Hong Kong Government bears primary responsibility for bringing calm to hong kong. Violence and unrest cannot be resolved by Law Enforcement efforts alone. Su the bank of japan governor says he regrets he has not been able to achieve the target of 2 inflation. Japan is no longer in deflation, where prices only fall, and he does not agree with calls for a higher cpi goal. He added that policy neighbors are watching threats at home and abroad and will consider further easing if the risks increase. Abeld bolivian leader morales said the countrys legal head of state should be a senator from his majority socialist party, who was elected leader by the senate last week. Move,s dismissed a rival whose claim to be the interim president has been recognized by the u. S. And brazil. Inez declared herself Senate Leader in a session of congress boycotted by the allies of morales. Global news 24 hours per day on air and on twitter powered by more than 2700 journalists and analysts. Im su keenan. This is bloomberg. David thank you so much. Lets turn our attention to china. Specifically Monetary Policy. We have been getting signs that the pboc is signaling they are doing more. Have a look at our bloomberg chart. This is a very confusing set of Interest Rates. What they did one or two weeks they moved on the sevenday repurchase rate. It is said to be submitted and made public tomorrow. Rishaad the 21st of every month. David 20th. Rishaad tomorrow is the 20th. [laughter] rishaad good of you to join us. What does the pboc have left in its kit . It has so many different levers right now. What are going to be the most effective . Seem to be holding fire on the big one. The actual Interest Rate. I think the real issue is that the remain pretty reticent to use most of that toolkit. Point and thens on the mlf, a five basis point cut is pretty meaningless. It is going to do very little in our view to actually alter the liquidity conditions in the Banking System or really increase credit growth much. Cut that when they rate, they had just previously released the q3 Monetary Policy report, which pretty said much said Monetary Policy would remain the same and they would reduce lending costs to reform how the economy works, not by flooding the system with liquidity. We expect them to remain sitting on their hands for the most part in the coming few months. Then do i then take it that that means things are good . Isnt that a good thing that they are remaining fiscally disciplined . So, yes and no. I think part of it is sort of this longer term view. They are thinking at taking a hard look view for mediumterm really giving big stimulus in the short term. I would view that is positive. Policymakers are probably thinking, what are we going to do to address the mediumterm Growth Profile . How do we get productivity up . How do we lean more on fiscal instead of Monetary Policy . That is also reflective of their understanding, that the shortterm tools in the monetary side, really boosting credit growth and liquidity just create more headaches than they solve. Because of the high debt limit. Much more room is there . Some were saying the fact that the renminbi broke above seven without chaos that that ultimately breaks the whole impossible trinity china has faced, that there is currency flexibility now that gives them room in the Monetary Policy side and eases off the pressures from the trade war. What else can they do . That is the thing. They are sort of backed into a bit of a corner because now there is more flexibility in the currency, that is fine, but you put that in the context of the trade war, they dont want to currency blowout. They would like to keep the currency generally stable. , theye of the pork issue have very High Consumer prices. Also keeping a close eye on inflation. The room to ease is pretty limited. Instead, they are taking more structural factors. To lend more towards smaller more productive businesses but those type of structural changes to how Financial System works, they take time. That is why this policy response has taken much longer to filter into growth support then we have seen in previous rounds of stimulus were Economic Policy support. Because they are trying a new tactic and that is taking longer to filter into the economy, the economy has continued to slow throughout 2019 and we expected to continue to slow in the first half of 2020. Rishaad will it continue to slow if we get a deal on trade . The other part of my question would be, are we going to get a phase two and three . It has taken so long to get this one done. We nearly had one in may. This is when we are talking about the lowest of the low hanging fruit. This should be the easiest one to actually include, surely. Absolutely. I dont think a phase one deal really changes the Growth Profile. It might includes shift sentiment at the margin, but it is the tight financial conditions in weak Infrastructure Spending at the government level. Neither of those things is set to change. The pboc is kind of backed into a corner. It is signaling it is not going to go big. Local governments are saying, weve got more cash, weve issued bonds, but we dont have anywhere to spend it. Neither of those is going to change. We are still optimistic on the phase one trade deal. How much the cannot move sentiment when it is pretty clear that a genuine phase ii or phase three is not in the cards . It will take the box in terms of boosting a little bit of risk appetite, but from your average business on the ground, a phase one deal is not going to do a lot to change your future investment profile in building the next factory or change your perspective on what your order book looks like in the next six months. Yvonne all right, more perspective. The latest out of beijing. Thank you. A snack chain has seen revenue dropped by double digits as stores have come under attack by hong kong protesters. The chairman sat down with me for an exclusive interview. Earnings will definitely have an impact. Ever since the Antigovernment Movement began, we have had to close our stores early on some days. More importantly, tourist arrivals have come down. Locals are spending less, so there will be an impact. It never crossed my mind. I still dont understand why. Im innocent. You are talking about more than 70 of our stores vandalized, more than 180 times. This is a very big blow. We live in these very highly politically sensitive times, where any type of store, company that has any types of ties with Mainland China has been targeted by these antigovernment protesters. , these case specifically protesters were targeting your stores because of your alleged ties to mainland gangs. What can you tell us about these allegations . Why do you think you continue to be a target among antigovernment protesters . Hong kong is home to 1. 2 million fujian people. Every six hong kong people, there is one fujian person. You cant just tie fuji on people and gangs together because of the clashes in northpoint in august. I think that is very irresponsible. You are very heavily reliant on the Hong Kong Market. At what point do you think you might have to pull out of this market . To opene still on track more stores in macau. Our target is to open 1520 stores there in the next two years. We are considering plans to expand in china, as well. Do you still have confidence in the Hong Kong Market . I do. Wasme to hong kong when i 17. I have done business here for 30 years. A democratic, inclusive, and Peaceful Society and i think this movement will pass. I believe most people in hong kong are rational. Do you have any strategy to deal with antigovernment protesters . Any plans to start open dialogue with them or any conversation . That mentinue to stress or my company has not done anything to hurt hong kong people. There is a chinese saying, the wise man knows he knows nothing, the fool thinks he knows all. History real will reveal the truth. Do you see any kind of resolution to the situation right now . I have never seen anything like this. Hong kong now feels unfamiliar to me. I dont know why hong kong has become like this, like a war zone. That we have reached this stage, i think the government should set up an independent inquiry to look into the whole issue to give 7 million hong kongers an explanation. Yvonne that was my exclusive interview with the best mart 360 chairman. Now, this week, bloomberg tv will be in beijing for the new Economy Forum with panels and interviews. We will be hearing from the ge china president and ceo. Among others. This is bloomberg. Rishaad the maker of the hit toeo app tiktok is looking shake off its ties to china. They are facing mounting suits from u. S. Lawmakers and regulators. David our china correspondent joins us. They are trying to dissociate itself from one that is chinese, what is the Company Reportedly doing to further that endeavor . Reportedly looking to rebrand itself away from expandingotentially into southeast asia, singapore, as well as reducing the amount of chinese content on the app in the u. S. They have denied those claims, but the report does come at a time when it is facing increasing scrutiny from u. S. Lawmakers over National Security concerns. This is a rare instance of a chinese owned app becoming a consumer hit in the u. S. It has been downloaded more than 100 million times, known mostly for lighthearted lipsynching and goofy dancing videos. That data could be turned over to the chinese government. Threat in thetual sense that the committee on Foreign Investments in the u. S. Is reviewing the acquisition of musically, which has been turned into tiktok. We did see earlier this year the u. S. Government actually forcing let go companies to control of the u. S. Dating company grindr on the grounds of security concerns and data privacy. Yvonne what is the context behind this . How have they responded . The company has been trying is note that tiktok operated in china, it is operated by local u. S. Teams and they have been hiring aggressively across the United States. They have hired an audit firm to look over data practices. Their servers of data usage for u. S. Consumers is stored in the u. S. And some in singapores. Trying to convince u. S. Lawmakers that this is the case and they are not beholden to the u. S. Government. Yvonne they have said that from thestart musically has been flow of crossborder ideas. China. Raised in that it wouldping be a big hit in the u. S. , but now that it is a big hit in the u. S. , he has the task of proving that it is not beholden to its owner. David i think i still have my musically account. In any case, that is our guest. Our guest out of mumbai, good morning. Good morning. , we have been 11,900, not moving in either direction. To get a clear gauge of direction, we either need to break 12,000 on the upside or move to the downside. The last week was slack. The start of next week. We could not get any cues from that. Keeping in mind what kind of options activity we have been seeing, it looks like the ranges between 11,800 and it also happens to be one of the important moving averages. Downside thatther could come about. It could be a very crucial marker to take down the record highs. They are starting to pitch in a little bit. That and whathave we are to competition, watching for all of those and telecom is a part that is going to remain in focus. Theaad talking about things in focus, indian telcos, they are going to be raising mobile tariffs. Im guessing that it is all that money, the billions of dollars they have to pay and back taxes behind it. Interestings because we have seen the space , disruptingupted the pricing, disrupting the tariffs. Now they are indirectly increasing the tariffs, it looks like even the other two incumbents are looking to follow suit, but they are going to be looking at raising charges in their bundled plans. Something incting their bundling plans. This could benefit them positively in terms of getting Additional Data to these operators. All in all, it looks like a positive move. Hopefully, we will see a positive change over the last few days. Yvonne thank you for joining us for the latest from mumbai. Next up, the battle of the charts. This is bloomberg. Rishaad it is time now for battle of the charts, the battle of singapore. David four bloomberg clients, access to their charts on your terminals and a couple of minutes at the bottom of your screen. Lets kick things off. So we are seeing a lot of people being really positive in the stocks. We are starting to get the 2020 outlooks. We have people upgrading. One place where we are seeing some worry is in the options market. We did have the vix close at the lowest since april on friday. What we are seeing is the futures a few months out starting to show a lot of worry. People are buying a lot of vix calls, so the thing volatility is going to spike in a few months. As we see the u. S. Primary elections, stuff on trade coming out. Things look calm, but a lot of people are starting to bet on volatility in the First Quarter of next year. Rishaad i guess that is probably quite a good thing. We do have those events in prospect. Melissa, what have you got . Guys. I thought we would take it malaysia take a look at malaysia to mix things up. You would think cheaper prices would mean more investors from anywhere, but that has not been the case in malaysia. The malaysian stock market has underperformed considerably the ms ci, valuations near the lowestf in a decade. Unds have pulled out lowest in a decade. Funds have pulled out the most. What remains is to see whether to see what comes. Public spending may get a boost from the budget. The government has made some headway. Analysts expect movement in earnings. There are concerns with succession plans, as well as Growth Outlook for the country, the u. S. China trade conflicts. Things are looking a little bleak, but who knows . They might stage a comeback. Rishaad ok, david, you are the man who is going to judge today. It is not easy, i know. [laughter] david it is relatively easier today. Im going to apologize because i mean, the malaysians are a nonnews story. It has always underperformed. Lets talk about malaysia when it does perform well. Rishaad you are being so cruel in melissa. [laughter] rishaad she is visibly upset because of you. David it has been an objective truth the last five years. I cant remember when malaysia was in the top half of the asiapacific. Joanna, good point, especially with the fed now seemingly in pause. Money solves all sorts of problems, right . Congratulations, joanna. Rishaad there you go. Chartsrg news with those. Use g tv. Analysis andhe key save charts for future reference. A mixed bag out there today. This is bloomberg. It is almost 11 00 in singapore, 8 30 a. M. In mumbai. On Juliette Saly. Anna time rishaad salamat. This is a look at our top stories. The hong kong standoff entering a second day, protesters remaining on campus as police lockdown the area. Carrie lam says she wants a peaceful resolution. Juliette the escalating unrest is taking damage on a the hong kong economy. Ceding asia. Re is about the opportunities in the food industry. This is Bloomberg Markets. Juliette and little bit mixed for asian markets after two sessions of gains. The nikkei is tracking lower with a bit of money going into the japanese yen after we saw the greenback slumped after President Trump talked the dollar with jay powell. Resilience in the Hong Kong Market, off another. 9 despite the ongoing protest and the csi 300 looking pretty solid. We have seen a little weakness coming through in korean stocks. I want to focus on the currency markets. And mentioned the japanese yen, the greenback has been in focus but we have seen weakness in the aussie dollar today after the rba minutes came through, the rba saying it had a dovish tone and it priced back the nab. Weve been watching some of the moves in some of the asian currencies. You can see the peso is down by one third of 1 . We are awaiting the bop data coming through today. To imf, raising philippines 3. 6 in 2020. Because aussie, down. 25 against the dollar. And anna lets what we have at out of india, check in on a futures contract. We havent really done much over the last four days with futures but essentially, it would come against the backdrop yesterday. Equity markets were flat by the end of play. Rupee has been tracking to the downside against its american counterpart, 71. 91. 10 year yields ratcheting lower, below 6. 5 . 6. 48 at the moment for the yield on the 10 year sovereign. That is where we find ourselves. That find ourselves in new york with su keenan and the first word news. Nicky hong kongs chief executive carrie lam says she wants to peacefully resolve the continued standoff between police and press test protesters at the polytechnic university. She said police estimate around 100 protesters are still on the campus and the government is looking for ways to persuade them to leave. Blames rioters for turning parts of hong kong into what she called war zones, and said several University Campuses have become weapon factories. The boj governor says he wont rest until he receives the targeted 2 . With a higherree cpi goal. He added policymakers are watching threats at home and abroad, and will consider further easing. And the aussie dollar, which lost ground as details of the reserve banks latest meeting confirmed concerns over for the rate cuts. Minutes from the november 5 rba meeting show the central bank considered making a fourth cut in june but held off amid concerns households were being spooked by low borrowing costs. The board recognized the negative effects of lower rates on both savers and sentiments. Finally, struggling office space is facingwork scrutiny from the attorney general. The company says it is cooperating. Wework has had brush with legal offices in the past and last year reached a settlement of a noncompete agreement employee signed, but were seen as overly broad. Global news 24 hours a day, onair and tictoc on twitter, powered by more than 2700 journalists and analysts in more. Han 120 countries im su keenan. This is bloomberg. Juliette thank you. Lets discuss how markets are tracking with bloomberg mliv strategist mark ran for old mark cranfield. You made an interesting point yesterday that despite the escalating standoff between students and the police, people are putting money in here. Are they seeing in end game . Mark possibly and simply the valuations. Last six markets, the months or so, they have tracked so far behind the rest of asia that on some valuations, people would be saying hong kong looks relatively cheap. One of the things about the hang seng index, they are major global companies. They dont just get from hong kong, but all over the world. They are slightly protected in earnings even though hong kong might be in a Court Situation core situation a poor situation. They will still be paying dividends, company ballot sheens sheets. Ce there is thet chance at some resolution coming in the foreseeable future, they probably think the worst may be priced in and hong kong doesnt look so bad overall. Rishaad i think you have been weighing in on this tense meeting between President Donald Trump and fed chair jay powell. What implications have you gleaned for the dollar looking ahead . Mark part of the motivation is donald trump wanted to be sure the fed would take its usual stance. During a president ial election year, the fed would be as neutral as it possibly can. Im sure that is the message which came through from Jerome Powell in the meeting with donald trump. It would be very unusual for the Federal Reserve to want to move Monetary Policy one way or the other during an election year. It would have to see something extreme which makes them do so. That is probably why the fed have got their 75 basis points worth of cuts out of the way as soon as they can. They will probably go on to a hold in december and wellington next year. Intowill be happy well next year. They would be happy to leave rates unchanged. The downside is that leaves politicians to talk about the u. S. Dollar and Monetary Policy themselves, which is probably negative for the dollar. Juliette when it comes to the message from the pboc, a little chilling in the fix today . Mark it is pretty clear they set the level of the fixing at a point to remind people there is nothing going on here. We dont want you to get excited in one direction or the other. The trade talks are still going on. Just because we dont have a specific date doesnt mean it will not happen. We dont want you to sell off the yuan just because you havent heard good news in a while. Chill out and hang out at the same level. Juliette mliv strategist mark cranfield, thank you for your insights in singapore. Two big executive exclusives. And later,ential ceo the head of agribusiness. This is bloomberg. Juliette life Insurer Prudential is one month removed from splitting in two. The spinoff approved is allowing the company to focus on expansion in asia. Joining us in singapore is the executive leading that effort. Thanks for coming in. Tell us how it has been going one month in. You know, weve had overwhelming support from shareholders to pivot to the Growth Markets we are exposed to in the u. S. And in asia, but with the new strategy being asia led, that means more of an financialon, more resources will be provided for Growth Opportunities in this part of the world. Juliette you cant ignore what is happening in hong kong. How worried are you about what is affecting the city . Nick can have a well diversified platform. Were across 40 markets with Asset Management operations. Hong kong is an important market, but it is one of 14 markets. Yes, we want to see a return to the resolution of issues but having a platform across 14 markets makes the business resilient. Rishaad the whole idea of china as a market might be mouthwatering for you guys. You . Ig can it become for what are you targeting . Nick china is a very important market. If you are series about asia, you cant ignore the opportunities in china. We have a strong opposition on haveife insurance side and 84 of the market and our focus is to deepen our presence in the 90 odd cities we are in. There is no reason why china cant double its contribution to our numbers over the next three to four years and it would propel the underlying growth of our franchise. Rishaad absolutely, but how do you do it . Do you continue with the jv as it is or increase your share in the jv or deploy more resources . It is a pretty competitive place now, as well. Nick it is. Year, we are growing three times faster than the rest of the markets at the last results in june. After growth in premiums was 55 , so we are doing pretty well in partnerships. There are opportunities to deepen our presence in the 20 provinces and the 90 cities we are in. At the same time, we are looking where possible on our own and we launched our very own foreign owned entity based in shanghai which is showing early promise. Juliette saw a visa retained its china aviva retained its joint venture business. In your business would you consider m a to extend what you are seeing in leadership and your business in singapore . Nick we are always looking at a place to expand. It is still a race for distribution as the markets on the life side and Asset Management side are underpenetrated. We already have powerful relationships in our own type agency close but certain markets where we can get an advantage through new relationships, and we will be looking to do that. Juliette are there any specific new relationship you are looking at . Nick i cant comment on that, but rest assured an organization our size gets to see all the opportunities coming. Juliette what are some of the potentials for the Health Insurance business in asia . Nick Health Insurance is an important product for us and important area for us. At the last count, we have estimated we have around 9 of the value pool in that market. This is a market were effectively, people selfinsure. Up, 400ast started billion gets paid outofpocket, and we are one of the largest insurers and get we are only scratching the surface, we are looking to innovate on products, making products more affordable importantly,t more we are looking to of a provide Additional Services and seve recently launched pul by prudential, a health app looking to provide services to prevent or postpone the onset of disease. Rishaad one of the challenges is the undershirt underinsured middleclass people on board. How do you use Financial Technology to assist in that endeavor . The first thing to do that is a good question and the first thing to do is increase their awareness of the importance of insuring themselves. Our strategy is to offer them symptom checker , these are services they can in managingthem health care and wellbeing. Once we get them to increase their awareness of the importance of health, we hope in time, we can convert them into Wine Production buying protection. Rishaad going on from that, which of the countries, jurisdictions are you looking at because you got someone like china which is this year size of it, but you got the other aspect. We could talk about Health Insurance, life, etc. , where you have risk reward advantage, as well. Talk about the places where you see the latter. The need for insurance, particularly metalico medical insurance, is universal. The initiative i have just reference, pulse by prudential, is something we are looking to launch across 11 markets. Focused on southeast asia. And launched in malaysia three months ago and already we have nearly a quarter of a Million People registering and using the services. Singapore, hong kong, indonesia our next on the launch role of, rollout, so it will be launched pretty universally across our most most of our countries and we are pretty excited about doing something that can bring value to consumers, but ultimately act as a segue to demonstrate to them the value of insuring their health and ultimately their life. Juliette the rising middle class is under pending a lot of growth underpinning a lot of growth, not just in terms of health, but what about the aging population. Nick that is a massive issue, actually, for governments and individuals. 50 years ago, average Life Expectancy was 52. Look forward to today and the average Life Expectancy is 78. People are retiring and having to support themselves for many years in retirement and there are no obvious product across asia that allow people to withdraw drawdown on savings. This is expertise that prudential has elsewhere in the hong kongar have launched products in hong kong. We are seeing Strong Demand for those products and launched similar products in singapore. We are anticipating a pile up in china and are preparing to apply a pension slice. Ages, it is aion particular area where we have a lot of expertise and are looking to roll that out across a number of these markets. Juliette it sounds quite expansionary. Is there any change for headcount in your business . Nick are we trying to be more efficient in the things we do in order to get the headroom to go into new areas, new products such as retirement and the health services, new routes to market. We are establishing relationships with digital players, and the relationship established with indonesias biggest platform was the first of many we hope. We want to be more efficient and everything, but to redirect that resource to the new areas. Juliette thank you for coming in. That is prudentials ceo with me in singapore. A programming note for you. This week, we will be live in beijing at the Bloomberg Economy foreign, hosting a lineup of guests including dbs ceo sergio ermotti, mike wells, and ab inbev ofs ceo. Bloomberg subscribers can catch up with interviews by using our interactive function tv and send instant messages to the team and guests during live shows. Check it out at tv. This is bloomberg. Juliette on Juliette Saly in singapore. Rishaad on rishaad salamat. Hsbc betting on the Property Price recovery in australia. Rates and borrowing rules sent price flooding into the market. To rise between 5 and 9 next year. They expect sydney and melbourne leading the charge. Financials saying they will apply for a virtual banking license that would add a contender to the race. The Monetary Authority offering up to five permits to nonbanks in a bid to open up the industry to new competitors. Has successful entry would pit chinas Biggest Companies against local lenders like dbs. The state of california has sued juul for allegedly marking it cigarettes to teenagers. The company cite out vulnerable partiest out vulnerable in the lawsuit. Is stepping down, the selfappointed industry rebel will leave april 30, the end of his current contract. He will stay on at the board. It is a long planned transition and the new chief executive will be president and chief operating officer mike siebert, the brains between many popular initiatives. Behind many popular initiatives. It is the stock of the hour and a2 milk. Ooking at juliette the milk producer listed in sydney, the wellington share price up 10. 3 , the most since february 18 and this is after the cow distributor cow milk distributor raised its fouryear ebit Market Forecast saying it sees strong first have andnue between 782 700 800 Million Dollars and looking at its revised margin saying the 29 to 30 forecast is stronger than the previously communicated announcement to the market due to the improved price yield and also lower cost of sales as the growth supported by branded market investment in china. We last heard from the Company August when he first that it expected its fullyear 20 20 you bit margin to drop, so the increase interest the market. Priced 182week high, kiwi dollars over the course of the year. The stock has risen nearly 27 and we have got some fairly next Analyst Recommendations when you look at the an hour function. Sells. Lds, 5 in sydney trade, rising as much as 17 . To get a glimpse of this and other stocks, it is most go when you check your bloomberg terminal. Rishaad today with regards to these markets, hong kong heading for its half an hour from its lunch break. Chinese markets, 90 minutes coming up. The index, up over 2 . Generally speaking, we see a mixed picture for stocks. You liquidity injection in the form of the reverse repo, moved to the downside for the five basis point cut taking place. Csi 300, up. 6 . Situationy, we have a where we have little or no signs of progress on the u. S. China trade negotiations. Elsewhere, asian stocks are drifting, to some extent, but in china, it is the other way. They are not drifting, they are moving to the upside currently. And off seng, up. 8 the highs of the day. In the midst of that, being driven by the msci the hshar es, 2. 1 to the upside. Equities up about. 5 . Hong kong dollar stable at the moment and comfortably within its trading range and the peg it has with the u. S. Dollar. 7. 83 hong kong dollars for u. S. Dollar. Lets take you to what else is going on. We have the hang seng being buoyed despite this background of unrest in the city and carrie lam earlier talking about most people being cleared away from the polytechnic campus earlier. Positivity in hong kong and shanghai, likewise. This is bloomberg. Almost 11 30 a. M. In singapore and we are in the middle of the trading debuted looks like a little bit of a muggy day. Down to six tens of 1 on the singapore straight index. A little bit of a trade influx. Tracking some other asian markets, lower optimism on the progress of the u. S. China trade negotiations. One of the worst performers, along with others. We were talking to prudential, and we heard that a u. K. Ensure that has been overhauling businesses will retain its Chinese Joint Venture as well as assets in its biggest market, singapore. Get the first word headlines with su keenan. Hong kongs chief executive carrie lam says she wants to peacefully resolve the continued standoff between police and protesters at the citys polytechnic university. She says police estimate around 100 protesters are still on campus and the government is looking for ways to persuade them to leave. She blames writers for turning parts of hong kong into what she calls war zones, and several University Campuses have become a weapon factories. Singapore meanwhile is warning that tensions in hong kong could happen in its city state as well. An official said a similar situation could easily happen if the government is complacent. The minister said they should heed the lessons of hong kong, especially while singapores relevance to the world is never a given. President trump says he discussed negative Interest Rates and the economy with fed chairman Jerome Powell today. The president tweeted it was a good and cordial meeting. He has criticized powell for not cutting Interest Rates far enough. The United States is reversing decades of middle east policy, declaring that israel settlements on the occupied west bank are not illegal. Secretary of state mike pompeo said the administration had studied the legal situation and decided that the building of jewish immunities in palestinian areas is not inconsistent with international law. Veteran palestinian officials denounced the move, saying it is another blow to the chances of peace in the region. Finally, the foul air choking new delhi is seen in causing intangible damage to the indian economy. Disruptions, fewer tourist arrivals, missed school days, and lost work hours were already affecting an economy struggling with the slowdown. Lossessays that indias from pollution rose more than four times between 1990 and 2013. Global news 24 hours a day on air and on tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. Im su keenan. This is bloomberg. Look at lets have a what is going on market wise. A mixed bag overall, indices in hong kong doing rather well. Perhaps we are reaching an in game with regards to protest on the streets. Said he our guest wasnt sure that was the reason, and it was broken hunting and the market is simple he up at the market. Ospi seeing a k little repression. The benchmark Industries Indices [indiscernible] there we go, pressure from the region. We could see further Interest Rate cuts coming through. That is a case of bad news translated as good by some to push the market up a fraction. At twokei 225 currently thirds of 1 lower. That is currently where we find ourselves. Asia is no surprise, the Worlds Largest food market and there is growing demand for better and sustainable food. Singapores investors are looking to tap into the opportunity by investing in food solutions. Ets bring in our guest as we know and as we just talked about, the increasing class is demanding more sustainable and better, more nutritious food. What kind of opportunities and challenges to investments are you looking at in the space . John think you put your finger on it. Theres a lot of macro trends we are pursuing that are consistent with us as an Investment Company but also with my responsibilities as the head of the americas. The population continues to grow and a lot has been documented about that. Challenges and opportunities across the value change are significant for us. We are pursuing opportunities all across that value chain and excited about the opportunities that present themselves. Iniette you are invested impossible foods and that space seems to be heating up. The move from meet to more plantbased alternatives. Tell us about your views on this investment and whether or not we could see an ipo. I would not want to get too far ahead of ourselves in terms of the ipo, but we are very excited about the investment. This came from an alternative protein study waited as we saw study we did, as we saw the trends of things we wanted to be invested in given the nature of what we are trying to do. Frankly, it is usually consistent with the Consumer Trends happening and Consumption Trends happening and population growth and what people want and the variety of things they can have on the dinner table for food. Also usually consistent with our push on sustainability. The earmarks of what we want to align with and it has worked out quite well and we are proud of the investment. The whole idea of impossible foods is one of the Consumption Trends. Tell us the others you are seeing and how you take advantage of them. I think john i think theres been a lot written about peoples protein tastes. Whether it is aquaculture and fish, or chicken is a form of protein, a lot of different trends are happening in the space. As rising affluence and populations become more urbanized, their consumptions, taste and preferences change. We want to align ourselves against all of those various inortunities inconsistent consistency with the effect on the environment. Rishaad im trying to get to more specifics. In china, port prices have gone up so much that people are moving into beef and chicken and other meats, and that could be something that is more permanent. And elsewhere, what you are seeing too. John absolutely. You see the impact of things like african swine flu and peoples preferences change. There will have to be changes to consumption patterns. We see that happen around the world but certainly in asia specifically. This population is a big part of the population growth we talked about on a global scale. Thats what were trying to line up against. But we pursue it from a global perspective and asia just happens to be a huge outlet for a lot of these trends. Here in john, you are singapore, which is a very urban city. There is a lot of vertical farming. What viability do you see in the space . John we have some significant in basements significant investments in singapore as well as in the u. S. We think it is a trend that has a lot of viability. Not all will be successful. We think weve picked a couple that will have a greater chance of being successful. We want to give them our full support as they go from earlystage to mentoring businesses. Thats one of the things we try to take advantage of. The early returns on technology and the cost curve and acceptance on the part of the consumer give us a lot of confidence and optimism for that being a regular part of the production economy, if you will. Juliette if we look at what is theresg with monsanto, more than 30,000 plaintiffs in the u. S. Looking at roundup and links to cancer. Do you still think that was a good deal . Yeah, look, i think and other Public Forums the investment was written with a longterm point of view. We did all of the work and diligence we always do, very thorough, comprehensive review of any investment, particularly one of that magnitude. I think the litigation taking place is unique to the u. S. In the operating thesis and the reasons we did that in terms of the trends of the buyermonsanto combination still hold true today. The investment might take longer to play out, and its early had pressure in terms of people with a different timeframe than we have, including investors who cant stand any downward pressure that the litigation may be causing in the share price. But the fundamental thesis by way made the investment holds true and we are quite confident and optimistic we will get back to our underwriting case. Rishaad to be fair, you probably did not see that one coming by any stretch of the imagination. With the benefit of hindsight, have you made any changes to the way you operate Due Diligence as a consequence . John no. As i said, this was done in a ,ery comprehensive, complete diligent fashion. It was done in the context of a private placement. Some of our diligence was even more significant than one could do in an outright public markets, public securities purchase. I think anytime you go through Something Like this, you are somewhat introspective as to things you learned and lessons you learned, but from a fundamental diligence and work process and underwriting process, we are quite confident and we remain confident in the investment itself. You i just want invest in startups immature businesses, right across the value chain. Tell us if there is a company you invested in or specific area you are really excited about looking ahead. John i think we are excited about everything we do. You expect me to say that but i think a lot of the plantbased alternatives that are touching on a lot of different parts of the value chain as a result as it pertains to agriculture and food. There are a lot of things in earlystage investment in terms of the impact on nutrient application and things of that nature. There is investment in Farmers Business Network in the states we think will have a big impact in terms of profitability to individual farmers. I have four kids, i dont love one more than the other, but we are excited about our opportunities and the form of our capital, as you correctly point out, can allow us to do earlystage stuff, stay with those companies, invest alongside them on their journey, and where we may have missed a trend, still come in at a later date either before or after the ipo because we have the flux ability in the capital base. Juliette thats what every parent says. Thank you for joining us in singapore. Coming up, we will head to mumbai as Indian Markets reopened for the days trading. This is bloomberg. Youre watching Bloomberg Markets asia. The Indian Telecommunications company and its rival will be raising mobile tariffs for the first time in three years. Our reporter has the story. What is behind this surprise price hike . In my right in guessing its to pay for these huge bills they have to pay in back taxes . Absolutely you are right. That is one point. September, one of them had indias highest ever loss. Companies had a huge loss. Alone because of the taxes and other charges. Expressednies have doubt going head as a going concern. This has led to the price hike. There is also a catch. Atop a panel of bureaucrats in the government studying the issues in the telecom sector, they are expecting some financial moratorium in the loan sector. Is why they are going for the hike come although theyve not disclose the details but they clearly said they are going for the hike. Juliette what does this mean for the overall industry . It has been reeling from huge losses. A good question. This election brought some sanity to the market. Alliance launch of the , both of these companies have not been able to increase their prices. The price was always going to one side, always down. Place that the companies can have a price increase, and help them to stay alive for now. Rishaad thanks a lot. Indian markets have just opened to the upside. Lets look at the session. Day dull day yesterday. Absolutely right. Markets have been trading very tired. The benchmark industries and the broader markets it remains to see if the gains can be sustained. From the high levels there is some profit kicking in. As we speak, the nifty has slipped. Hasbanking index, which outperformed nifty in the last month, is seeing positive uptick come up about 28 points. The broader markets, the nifty 500 index up about 12 points. Session we are seeing some cool off coming into the india index. Juliette and we just heard imagine thate, i is a stock your tracking in the opening session. Thats right. Telecom stocks feature right there at the top. As was mentioned, the first time in three years that they have announced a price hike. But the increase is not known yet, it will be announced in december. One of the notes i was reading from jeffries, reliance move will be key to monitor now. These companies have some elbowroom to increase by 10 timber seemed because 10 15 . One has been trading at a 52week high level. A company has said it has outlined proposals for Sustainable Business operations in europe. They have plans in the u. K. And netherlands and have clearly stated that they want to open operations to become cash positive financially by 2021. The plan includes increasing sales of higher value assets to improve the product mix, and cut 3000 jobs. The stock however is muted in the opening trade, about 411. Juliette thank you so much. Cfo outlines the co2 plans. Highlights from interviewer coming up. This is bloomberg. Check of theuick latest business flash headlines. Carriers are reportedly cutting flights to hong kong as protest continue to roil the city and deter visitors. The South China Morning Post says one flyer halted all services, while another cut to 32 flights. Other carriers in asia have also cut services. One plans to operate four weekly flights from anyone, and others are cutting one of five daily flights. South Koreas Fair Trade Commission has begun an antitrust penalty process against the countrys biggest internet portal, according to local media reports. News says that they have filed a of rules,o violations but an official says it has yet to receive the report. Kylie jenners teenage startup has turned into a billiondollar business venture. Isugh Global Beauty company paying 6 million in cash for a majority stakes in the line, valuing it at about 1. 2 billion. It is the latest move by a major Beauty Company to acquire 20 brands that appeal to younger clientele. Rishaad bps chief Financial Officer says reducing co2 companyswill be the biggest technological challenge as it moves ahead. He spoke to our reporter from london. The issue for Companies Like bp is how we do with the co2 that comes with oil and gas and how we offset that in some way Going Forward. Thats why the big technological challenge for us Going Forward. How do you do it . Is we laid out icat we called the r framework. We have reduced the co2. We have a target of taking 3. 5 million tons out and i think we will hit that target well before 2025. We are looking at improving our products of a less carbon intensive and venturing into lower carbon businesses like a light source bp, one of the largest Solar Developers in the world. We have a venture in brazil that is a Huge Investment Going Forward in terms of producing fuels that are 70 more efficient compared to gasoline alternatives. On a number of fronts, and the Biggest Issue will be co2 associate with Oil Production over the next two decades. We will be talking here later today about a big project we are doing yearround and carbon reset quest ration sequestration to find ways of developing oil and gas. Lookingpeople are forward to hearing from you. I want to talk about the dividend. There were hopes for a dividend from you. You said the dividend will come back, we will discuss it in the Fourth Quarter, but likely be on that. We need to look at where the company has grown by the middle of the year next year. Talk to me about what happened the last few months and why the expectations around potential highyield did not quite materialize. In three q, we, announced a cancellation of effectively a dilution that was about 20 each quarter. Theanceled that, that was first point in terms of distributions. We also have some thing in the region of 2 billion of buybacks slated, offsetting the script in 2017, which you said we will do by the fouryear results this year, early february. Were in the process of doing those buybacks. In terms of distributions, there is significant momentum already. What we said at the midpoint of this year is we will come back to the board, and we look at the dividend every quarter. We will look at it in Fourth Quarter in the board will make a decision. Where the Balance Sheet is at a time. We have 10 billion at our disposal as a cash rise, that has given us the confidence to proceed with the buyback program, but the board will look at the Balance Sheet, the growth into next year, and we will make a decision in 4q. Just a quick final question. We caught up with jeremy corbyn, leader of the labour party early this morning. This is what bob dudley had to say earlier this year. , iemy corbyn government think it is alarming for everybody. What specifically about it is alarming to the csuite of bp . Bob think the things that was alluding to is some of the things that are been discussed at the congress. We dont typically comment on whatever government will come into power but i think bob was referencing the idea of a 10 ownership stake that will be taken in each of the companies. Those were the alarming type things we saw. Bphaad that was the cfo of talking to jonathan ferro. This week, Bloomberg Television will be in beijing for the new Economy Forum. We have wideranging panels taking place as well as interviews. Severalbe hearing from people. And just having a quick look at markets, pretty flat on the msci asia index, some weakness coming through in japans market. Hong kong stocks still resilient. Up another 8 10 of 1 today. We saw another pickup in indias market. The aussie dollar pressure after the rba minutes had a clear dovish tone. That is it from Bloomberg Markets asia. This is bloomberg. Beyond the routine checkups. Beyond the notsoroutine cases. Comcast business is helping doctors provide care in whole new ways. All working with a new generation of technologies powered by our gigspeed network. Because beyond technology. There is human ingenuity. Every day, comcast business is helping businesses go beyond the expected. To do the extraordinary. Take your business beyond. Taylor i am taylor riggs in for emily chang and this is bloomberg technology. Coming up in the next hour, wework layoffs are set to begin this week in the u. S. What this means for the future of the company amid a tumultuous year. Plus, u. S. Lawmakers are looking to make life harder for the chinese owners of the video app tiktok. We will have details on the new National Security bill. And, trucks before taxis. Will